Pension advice

[Alex321]

Sorry, I am not sure what your point is re 2025 unless it is because I should have said reach instead of reached? The basic principle remains the same in either case.

You said (rightly) that the rules are different if you reached state pension age before 2016. I was just pointing out that I didn't - I haven't even reached it yet, never mind in 2016.

Some of the quotes above are mixing up the terms of the Basic State Pension (old scheme) with the New State Pension (new scheme).

Under the terms of the New State Pension scheme in 2025 you will receive, provided you have the required number of qualifying years the full amount if the New State Pension plus an uplift for any S2P or SERPS contributions, if you made any, less an amount for any contracted out period you may have had - the latter having resulted in you paying lower NI contributions.

The uplift is a protected payment for those who have already paid above the normal rate of contributions of NI under S2P/SERPS - as these schemes are now finished then going forward it will not be possible to get more than the basic New State Pension rate if you have not already contributed to S2P or SERPS.

Ok. That makes sense - but is not what the government site says, which is why I was confused.

On this page https://www.gov.uk/new-state-pension/what-youll-get it doesn't mention SERPS, but when it calculates my forecast, it has obviously taken it into account.

All it says there is:

What you'll get​

Your State Pension amount depends on your National Insurance record.
Check your State Pension forecast to find out how much you could get and when.
The full new State Pension is £185.15 per week.
The only reasons you can get more than the full State Pension are if:

• you have over a certain amount of Additional State Pension
• you defer (delay) taking your State Pension

And on the Additional Sate Pension page, it says

Overview​

The Additional State Pension is an extra amount of money you could get on top of your basic State Pension if you’re:

• a man born before 6 April 1951
• a woman born before 6 April 1953

Neither of which apply to me.

 

[SpokeyDokey]

You said (rightly) that the rules are different if you reached state pension age before 2016. I was just pointing out that I didn't - I haven't even reached it yet, never mind in 2016.



Ok. That makes sense - but is not what the government site says, which is why I was confused.

On this page https://www.gov.uk/new-state-pension/what-youll-get it doesn't mention SERPS, but when it calculates my forecast, it has obviously taken it into account.

All it says there is:

What you'll get​

Your State Pension amount depends on your National Insurance record.
Check your State Pension forecast to find out how much you could get and when.
The full new State Pension is £185.15 per week.
The only reasons you can get more than the full State Pension are if:

• you have over a certain amount of Additional State Pension
• you defer (delay) taking your State Pension

And on the Additional Sate Pension page, it says

Overview​

The Additional State Pension is an extra amount of money you could get on top of your basic State Pension if you’re:

• a man born before 6 April 1951
• a woman born before 6 April 1953

Neither of which apply to me.

The confusion arises in thst last section doesn't it.

It would have helped if they had worded it better ie you will receive Basic State Pension (ie old scheme) if you were born before the following dates etc and Additional State Pension may be paid on top of it.

It has nothing to do with the New State Pension.

Good news that your SERPS contributions have been recognised in your forecast.

The forecast will also show any deductions for periods of Contracted Out if applicable.

One thing that many people seem not to be aware of, is that upon your death, any surviving marital partner will be entitled to 50% of the protected SERPS element of your pension.

 

[rogerzilla]

If you are in one of the DC schemes masquerading as a pension, as are most people, check your funds at least weekly and don't rely on them to look after themselves. The last year has been disastrous for default investment options, especially "less volatile" pre-retirement funds.

https://www.trustnet.com/factsheets/p/lm67/av-pre-retirement-fixed-interest-fp-pn

You see that? That's a third of your retirement fund gone, if you retired in October.

 

[The Central Scrutinizer]

Are you receiving the New State Pension?

If yes and you are receiving more than the basic rate of NSP (not to be confused with Basic Rate State Pension) then you will have contributed to S2P/SERPS at some point in your career.

Yes

 

[gzoom]

Yes but when they do the estimate they ask for a date you would like the pension payable on.

So unless youre asking years in advance (I'm not) - they know my pensionable pay and my retirement date.

So they can do it. They just don't.

Does the ESR website not give you info? I haven't checked but my annual pension statement seems accurate interms of contributions.

https://my.esr.nhs.uk/dashboard/web/esrweb

For those of us old enough to be in system when it changed from final salary to defined benfits its actually worked out well. My 'average salary' protion assumed my starting salary is pretty high up on the payscale so it might as well be final salary (or pay out more than the 1995/99 scheme!!), and the payout figure is growing currently at inflation + 1.5%, so double digit growth with zero risk or effort from me.

The current changes in tax allowance now also means no issues with been double taxed on pensions regardless of working length.

There are lots of things to complain about in pay for NHS staff, hence all the strikes, the NHS pension however is literally a pot of gold at the end of a long, sometimes not so pleasant but always interesting rainbow of work .

 

[rogerzilla]

You're lucky; we changed from final salary to defined contribution, which is shite. AIUI NHS staff went from final salary to 1/54ths average salary, which is still extremely good compared to almost anything else out there.

 

[gzoom]

AIUI NHS staff went from final salary to 1/54ths average salary, which is still extremely good compared to almost anything else out there.

Don't forget the inflation+1.5% annual growth, guaranteed with zero risk or effort!!!

What's amazing though is many NHS staff don't realise how amazing the pension is, and choose to leave the scheme!!

 

[PaulSB]

Don't forget the inflation+1.5% annual growth, guaranteed with zero risk or effort!!!

What's amazing though is many NHS staff don't realise how amazing the pension is, and choose to leave the scheme!!

Yep, my wife has an NHS pension. When she worked any FA we spoke used to simply say there was nothing to discuss as nothing could beat it.

 

[DCLane]

SWMBO's got 28 years in the NHS scheme to date and will have 35-40 years in it when she retires.

I've got 25 years in the Teacher's pension scheme and will have 32-33 years when I retire and go part-time plus 5 years in a company scheme prior to education.

Both are better than anything else out there at the moment despite it being final salary up to 2016/2022 and then career average salary.

 

[rogerzilla]

Don't forget the inflation+1.5% annual growth, guaranteed with zero risk or effort!!!

What's amazing though is many NHS staff don't realise how amazing the pension is, and choose to leave the scheme!!

Wow!

Even our oldest scheme is capped at max 5% RPI (and you can bet they'll change that to CPI when RPI is retired).

I expect inflation to eat away at my pension, but I should at least get a big top up when I reach OAP pension age later on.

 

[kingrollo]

Don't forget the inflation+1.5% annual growth, guaranteed with zero risk or effort!!!

What's amazing though is many NHS staff don't realise how amazing the pension is, and choose to leave the scheme!!

Many ?

Most of the younger staff aren't in the pension - it's just too expensive.

I've gotta disagree about how great it is as well - ive got 20 years contributions - which will give me an annual pension of £5k .....

 

[midlife]

Many ?

Most of the younger staff aren't in the pension - it's just too expensive.

I've gotta disagree about how great it is as well - ive got 20 years contributions - which will give me an annual pension of £5k .....

Not sure you would get a better private pension. Not sure which financial advisor would suggest dropping out of the NHS pension....

£5k a year after 20 years on a circa £20K salary is not too shabby..

 

[rualexander]

If you are in one of the DC schemes masquerading as a pension, as are most people, check your funds at least weekly and don't rely on them to look after themselves. The last year has been disastrous for default investment options, especially "less volatile" pre-retirement funds.

https://www.trustnet.com/factsheets/p/lm67/av-pre-retirement-fixed-interest-fp-pn

You see that? That's a third of your retirement fund gone, if you retired in October.

Gone for now, but not necessarily gone for ever.
Like most investment schemes, they go up and they go down.

No point in checking them "at least weekly", what are you going to do if you see it falling in value? You can't time the market.

 

[yello]

If you are in one of the DC schemes masquerading as a pension, as are most people, check your funds at least weekly and don't rely on them to look after themselves. The last year has been disastrous for default investment options, especially "less volatile" pre-retirement funds.

https://www.trustnet.com/factsheets/p/lm67/av-pre-retirement-fixed-interest-fp-pn

You see that? That's a third of your retirement fund gone, if you retired in October.

I have 3 I regularly check, and all have taken a hit by varying degrees though fortunately none that badly, and I have time on my side for them to recover (hopefully). Knowing what, if anything, to do about it is another matter! You'd kinda hope the pension companies might re-evaluate their default... but to what?

Tbh, it angers me that people's retirement savings are being handled in this manner, requiring financial advisors to understand. If your retirement pot is decimated, wtf are you supposed to do? Just accept 'the price of stocks can go down as well as up' and smile your way through old age poverty?

 

[sevenfourate]

I have 3 I regularly check, and all have taken a hit by varying degrees though fortunately none that badly, and I have time on my side for them to recover (hopefully). Knowing what, if anything, to do about it is another matter! You'd kinda hope the pension companies might re-evaluate their default... but to what?

Tbh, it angers me that people's retirement savings are being handled in this manner, requiring financial advisors to understand. If your retirement pot is decimated, wtf are you supposed to do? Just accept 'the price of stocks can go down as well as up' and smile your way through old age poverty?

Quite. This is my work / compulsory Nest Government pension. Which I’ve been ‘forced’ to pay into by the Government for 7 (?) years - in order that I look after my own future 🙄

Whilst I’m very glad of the tax relief. And the contributions my company is again ‘forced’ to put it: it’s not exactly showing any year on year growth 🤦‍♂️

I have a private one that’s doing very well thankfully. But you do get the feeling someone is doing very well out of the Nest pension whilst keeping it doing just enough to keep ‘us’ / the masses quiet 🙁